Elgin County to flip added revenue into community improvement

People at the West Elgin Recreation Centre in Rodney, discuss ways they want to see the local economy develop. Their communities will get a boost once the county does away with a tax break allowing people to buy commercial buildings only to leave them empty and flip them for a profit down the road, a problem across rural Ontario. (Louis Pin, Times-Journal)

The County of Elgin is taking it one step further. They plan to use the windfall – estimated at roughly $80,000 in additional tax revenue each year – to fund their Community Improvement Plan, an initiative to help local business owners fix up their properties.

The hope is to encourage more activity in small towns across the County of Elgin.

“It’s all across rural Ontario,” said Bernie Wiehle, mayor of West Elgin. “You have a number of properties, commercial, industrial properties that are vacant and some of them are obviously held locally … but some of them are bought by outside interests, they’re being speculated upon.”

It’s a problem. Numerous storefronts in rural centres like West Lorne and Rodney, both in Wiehle’s jurisdiction, have remained vacant for years. Those empty businesses can bring down the value of an entire neighbourhood especially if the business owners let them go into disrepair.

But without the proposed CIP investment, local business owners already struggling to fill their buildings will be hit even harder.

"A property that’s going derelict is going to bring down the entire neighbourhood."

~ Jim Bundschuh, with the County of Elgin

It’s a compromise, one unique to the County of Elgin.

“A property that’s going derelict is going to bring down the entire neighbourhood,” said Jim Bundschuh, director of financial services with the County of Elgin. “What we like to see is businesses being revived, properties being revised.”

In a way it comes as a blessing. Elgin’s Community Improvement Plan did not have indefinite funding and would have soon been phased out. With the added revenue it can now operate indefinitely, or until council decides to phase it out.

The overall plan will need provincial approval but will likely pass, according to county staff. Information sessions will be held later this year for local owners interested in the CIP.

The tax change comes into effect in 2018. With any luck, Wiehle says, community improvement will follow.

“It’s not going to happen overnight,” Wiehle said. “I think [this] will encourage people to, you know, open up a storefront or put something in there … it doesn’t have to be a traditional store selling merchandise, but something.

“We have several businesses in West Elgin that have taken advantage of that plan to do improvements,” Wiehle added. “It’s a great service to these businesses that want to invest.”

The current vacant tax law doesn’t help places like Rodney, where a once-bustling downtown has been replaced with empty storefronts unlikely to attract other businesses to the area. (Louis Pin, Times-Journal)

The most “vacant” communities

Under the old tax laws commercial properties considered vacant were taxed at 70 per cent, and industrial properties got an even bigger break. The upcoming change will do away with that tax break entirely, and will help some places in Elgin County more than others.